Principles of Economics, 7th Edition

Published by South-Western College
ISBN 10: 128516587X
ISBN 13: 978-1-28516-587-5

Chapter 14 - Part V - Firms in Competitive Markets - Problems and Applications - Page 297: 3

Answer

Bob is wise to not shut down in the short run. He has variable costs of 250 dollars, which is less than his total revenue of 270 dollars.

Work Step by Step

However, Bob is not wise to continue operating in the long run. His total costs of 280 dollars are more than his total revenue of 270 dollars.
Update this answer!

You can help us out by revising, improving and updating this answer.

Update this answer

After you claim an answer you’ll have 24 hours to send in a draft. An editor will review the submission and either publish your submission or provide feedback.